20-F











Exhibit 4.9  



SECURITIES PURCHASE
AGREEMENT 



Dated as of 



December 10, 2007 











SECURITIES PURCHASE AGREEMENT 



        This
SECURITIES PURCHASE AGREEMENT (this “Agreement”) is made and entered into
as of December 10, 2007, by and among B.O.S Better Online Solutions Ltd., an Israeli
company (the “Company”), and the entities listed in Schedule
1 (collectively, the “Investors” and each, an
“Investor”). 



        WHEREAS,
subject to the terms and conditions herein, the Investors desire to acquire from the
Company, and the Company desires to issue to the Investors Ordinary Shares of the Company,
par value NIS 4.00 each (each, a “Share” and collectively the
“Shares”, and when referred to the shares to be purchased by each Investor, such
number of shares as set forth opposite such Investor’s name in the column labeled
“No. of Shares” on Schedule 1 hereto); and 



        WHEREAS,
in connection with the Investors’ purchase of the Shares hereunder, the Company
wishes to issue to the Investors such number of warrants to purchase Shares as set forth
opposite each Investor’s name in the column labeled “No. of Warrants” on
Schedule 1 hereto (reflecting 65% warrant coverage), on the terms and conditions hereof,
and the Investors wish to purchase such number of warrants; 



        NOW,
THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the Company and the Investors hereby agree as follows: 



1.     PURCHASE
AND SALE OF SHARES.  



    1.1        Subject
to the satisfaction of the terms and conditions described in this Agreement, at the
Closing (as defined below), the Company agrees to sell to each Investor, and each
Investor, severally and not jointly, agrees to purchase from the Company, such number of
Shares, against such amount, as is set forth opposite each Investor’s name in the
columns labeled “No. of Shares”and “Purchase Amount”, respectively,
on Schedule 1 hereto, and reflecting a price of $2.40 per Ordinary Share (the
“PPS”).  



    1.2        The
parties agree that Schedule 1 hereto may be revised, at the Company’s sole
discretion, to reflect additional investments by additional investors (the “Additional
Investors”) who shall execute the Transaction Documents (as defined below) and
be deemed Investors for the purpose hereof, provided however, that in no event
shall the aggregate number of Shares issued to the Investors and the Additional Investors
(including the Shares issuable under the Warrants) exceed 19.5% of the issued and
outstanding share capital as of the date hereof.  



    1.3        At
the Closing, the Company shall issue and deliver to the Investors a Warrant in the form
attached hereto as Exhibit A (the “Warrant”) to purchase such number of
Shares as is set forth opposite such Investor’s name in the columns labeled “No.
of Warrants”. The Warrant shall be exercisable for a period of four (4) years from
the date of issuance (the “Warrant Issue Date”). The Warrant’s exercise
price shall be $2.76 per Share.  












     2.    
          CLOSING. The execution and delivery of this Agreement shall occur upon
          delivery by facsimile of executed signature pages of this Agreement and all
          other documents, instruments and writings required to be delivered pursuant to
          this Agreement to Amit, Pollak, Matalon & Co., NITSBA Tower, 17 Yitzhak
          Sadeh St., Tel-Aviv 67775 Israel attn: Shlomo Landress, Adv., Fax: (972) 3
          568-9001. The closing of the purchase and sale of the Shares will take place ten
          (10) days after the date hereof (or, if such date is not a business day, on the
          next business day thereafter), on which date the conditions for Closing set
          forth in Sections 5 and 6 herein shall be satisfied in full or waived by the
          appropriate party thereunder, or at such different date as may be mutually
          acceptable to the Investors and the Company (the “Closing”). At
          the Closing, each Investor shall deliver to the Company payment in full (without
          deduction of any fees or taxes) for the Shares to be purchased by such Investor
          in the amount set forth opposite such Investor’s name in the column labeled
          “Purchase Amount” on Schedule 1, via wire transfer of
          immediately available funds or bank or cashier’s check. At the Closing, the
          Company will deliver to each Investor a duly executed share certificate
          reflecting such number of shares set forth opposite such Investor’s name in
          the column labeled “No. of Shares”, and a Warrant validly executed by
          the Company. 



     3.    
          REPRESENTATIONS AND WARRANTIES BY THE COMPANY. The Company hereby
          represents and warrants to each Investor that: 



    3.1        Corporate
Organization. Each of the Company and its Subsidiaries (as defined below) is (i) a
corporation duly incorporated, validly existing and in good standing (where such concept
is applicable) under the Laws of the jurisdiction of its organization, (ii) has the
corporate power and authority to own, lease and operate its property and to carry on its
business as now being conducted, and (iii) is duly qualified and in good standing to do
business in each jurisdiction in which the nature of the business conducted by it or the
ownership or leasing of its properties makes such qualification necessary, except to the
extent that the failure to be so qualified or be in good standing would not have a
Material Adverse Effect. As used in this Agreement, “Material Adverse Effect” means
any material adverse effect on the business, properties, assets, operations, prospects,
results of operations or condition (financial or otherwise) of the Company and its
Subsidiaries, taken as a whole. The Company’s shares are traded on the Nasdaq Global
Market and on the Tel-Aviv Stock Exchange (the “Principal Markets”) and
as such it is subject to both US and Israeli Securities Laws. “Subsidiaries” shall
mean BOScom Ltd. and Odem Electronic Technologies Ltd.  



    3.2        Due
Authorization and Valid Issuance. The Company has the corporate power to enter into
this Agreement and the Registration Rights Agreement (the “Transaction Documents”).
The Transaction Documents have been, or will have been, at the time of their respective
execution and delivery, duly executed and delivered by the Company. Prior to the Closing
of this Agreement, the Company shall have acted to complete all corporate action
necessary on its part for the issuance, sale and delivery of the Shares, the Warrant and
the shares issuable upon exercise thereof (the “Warrant Shares”). The
Shares being purchased by the Investors hereunder and the Warrant Shares will, upon
issuance and payment therefore pursuant to the terms hereof, be duly authorized, validly
issued, fully-paid and nonassessable.  



    3.3        Binding
Agreement. The Transaction Documents constitute valid and legally binding obligations
of the Company enforceable against the Company in accordance with their respective terms,
except as (i) such enforceability may be limited by bankruptcy, insolvency,
reorganization, arrangement, moratorium or similar laws relating to or affecting the
rights of creditors and contracting parties generally, (ii) the remedy of specific
performance and injunctive and other forms of equitable relief may be subject to
equitable defenses and to the discretion of the court before which any proceeding
therefore may be brought, and (iii) rights to indemnity and contribution may be limited
by Israeli or U.S. state or federal securities laws applicable to the Company or by the
public policy underlying such laws.  



3








    3.4        Non-Contravention.
Neither the execution and delivery of the Transaction Documents, nor the consummation of
the transactions or the performance of the obligations contemplated hereby and thereby
will result in any violation or breach of Company’s articles of association,
by-laws, board resolutions or shareholders resolutions, or result in a violation of any
law, rule, regulation, order, (including federal and state securities laws and
regulations and the rules and regulations of the Primary Markets) or, to the Company’s
best knowledge, judgment or decree.  




    3.5        No
Consent. To the Company’s best knowledge, and in reliance on the representations
of the Investors given in Section 4 hereof, except for reporting obligations and
approvals required under applicable securities laws and market regulations in Israel and
the United States and for notices to or approvals by the Office of the Chief Scientist
and the Investment Center of the Ministry of Industry, Trade and Labor (if required) no
consent of any governmental body or third party is required to be made or obtained by the
Company in connection with the execution and delivery of the Transaction Documents by the
Company or the consummation by the Company of the transactions or the performance of the
obligations contemplated hereby and thereby by the Company.  



    3.6        Capitalization.
The authorized share capital of the Company consists as of the date hereof: 35,000,000
Ordinary Shares, par value NIS 4.00 per share, of which, as of September 30, 2007,
9,609,911 Ordinary Shares are issued and outstanding, and 2,600,000 Ordinary Shares are
reserved for issuance upon the exercise of warrants and of employee, director and
consultant options already granted by the Company. The Company is currently in
discussions with other investors with respect to additional financings, in which
financings the price per share may be different than the PPS hereunder.  



    3.7        SEC
Documents. Since January 1, 2006, the Company has timely filed all reports,
schedules, forms, statements and other documents required to be filed by it, as a foreign
private issuer, with the Securities and Exchange Commission (“SEC”)
pursuant to the reporting requirements of the Securities Exchange Act of 1934, as amended
(the “1934 Act”) (all of the foregoing filed prior to the date hereof or
prior to the date of the Closing, being hereinafter referred to as the “SEC
Documents”). As of their respective dates, but subject to any amendments or
supplements in later filings, the SEC Documents complied in all material respects with
the requirements of the 1934 Act and the rules and regulations of the SEC promulgated
thereunder applicable to the SEC Documents, and none of the SEC Documents, at the time
they were filed with the SEC but subject to any amendment or supplement in later filings,
contained any untrue statement of a material fact or omitted to state a material fact
required to be stated therein or necessary in order to make the statements therein, in
the light of the circumstances under which they were made, not misleading.  



4







    3.8        Financial
Statements. The audited consolidated financial statements of the Company as of
December 31, 2006 and the related notes thereto, as filed by the Company with the SEC
under Form 6-K on March 27, 2007, and as amended in the Company’s filing on Form
20-F/A made on November 28, 2007 (the “Financial Statements”) fairly
present the financial position of the Company as of their respective dates, and have been
prepared in accordance with the books and records of the Company as at the applicable
dates and for the applicable periods. Such financial statements have been prepared in
accordance with generally accepted accounting principles applied on a consistent basis
throughout the periods therein specified, except as may be disclosed in the notes
to such financial statements, or as may be permitted by the Securities and Exchange
Commission and except as disclosed in the filings the Company made in connection with
such statements, if any.  





    3.9        Indebtedness
and other Contracts. Except as disclosed in the Financial Statements, or in the SEC
Documents and except for the guarantee by the Company of the Subsidiaries bank credit,
neither the Company nor any of its Subsidiaries (i) has any outstanding Indebtedness (as
defined below), (ii) is a party to any contract, agreement or instrument, the violation
of which, or default under which, by the other party(ies) to such contract, agreement or
instrument would result in a Material Adverse Effect, (iii) is in violation of any term
of or in default under any contract, agreement or instrument relating to any
Indebtedness, except where such violations and defaults would not result, individually or
in the aggregate, in a Material Adverse Effect, or (iv) is a party to any contract,
agreement or instrument relating to any Indebtedness, the performance of which, in the
judgment of the Company’s officers, has or is expected to have a Material Adverse
Effect. The Company’s SEC Documents provide a detailed description of the material
terms of any such outstanding Indebtedness . For purposes of this Agreement: (a) “Indebtedness” of
the Company or a Subsidiary means, without duplication, any of the following that
individually exceeds $200,000: (1) all indebtedness for borrowed money, (2) all
obligations issued, undertaken or assumed as the deferred purchase price of property or
services (other than trade payables entered into in the ordinary course of business), (3)
all reimbursement or payment obligations with respect to letters of credit, surety bonds
and other similar instruments, (4) all obligations evidenced by notes, bonds, debentures
or similar instruments, including obligations so evidenced incurred in connection with
the acquisition of property, assets or businesses, (5) all indebtedness created or
arising under any conditional sale or other title retention agreement, or incurred as
financing, in either case with respect to any property or assets acquired with the
proceeds of such indebtedness (even though the rights and remedies of the seller or bank
under such agreement in the event of default are limited to repossession or sale of such
property), (6) all monetary obligations under any leasing or similar arrangement which,
in connection with generally accepted accounting principles, consistently applied for the
periods covered thereby, is classified as a capital lease, (7) all indebtedness referred
to in clauses (1) through (6) above secured by (or for which the holder of such
Indebtedness has an existing right to be secured by) any mortgage, lien, pledge, charge,
security interest or other encumbrance upon or in any property or assets (including
accounts and contract rights) owned by the Company or a Subsidiary, and (8) all
Contingent Obligations in respect of indebtedness or obligations of others of the kinds
referred to in clauses (1) through (7) above; (b) “Contingent Obligation” means,
as to the Company or a Subsidiary, any direct or indirect liability, contingent or
otherwise, with respect to any indebtedness, lease, dividend or other obligation of
another Person if the primary purpose or intent of incurring such liability, or the
primary effect thereof, is to provide assurance to the obligee of such liability that
such liability will be paid or discharged, or that any agreements relating thereto will
be complied with, or that the holders of such liability will be protected (in whole or in
part) against loss with respect thereto; and (c) “Person” means an individual,
a limited liability company, a partnership, a joint venture, a corporation, a trust, an
unincorporated organization and a government or any department or agency thereof.  



5







    3.10        Legal
Proceedings. Except as disclosed in the Company’s SEC Documents, there is no
material legal or governmental proceeding pending or, to the knowledge of the Company,
threatened to which the Company is or may be a party.  



    3.11        Insurance.
The Company and its Subsidiaries are insured by insurers of recognized financial
responsibility against such losses and risks and in such amounts as management of the
Company believes to be prudent and customary in the businesses in which the Company and
its Subsidiaries are engaged. The Company and its Subsidiaries have not been refused any
insurance coverage sought or applied for and has no reason to believe that it will not be
able to renew its existing insurance coverage as and when such coverage expires or to
obtain similar coverage from similar insurers as may be necessary to continue its
business at a cost that would not have a Material Adverse Effect.  



    3.12        Employee
Relations. (i) Neither the Company nor its Subsidiaries has entered into any
collective bargaining agreement with their respective employees. The Company believes
that its and its subsidiaries’ relations with their employees are good. No executive
officer of the Company or its subsidiaries (as defined in Rule 501(f) of the 1933 Act)
has notified the Company or its subsidiaries that such officer intends to leave the
Company or its subsidiaries or otherwise terminate such officer’s employment with
the Company or its subsidiaries. No executive officer of the Company or its subsidiaries
is in violation of any material term of any employment contract, confidentiality,
disclosure or proprietary information agreement, non-competition agreement, or any other
contract or agreement or any restrictive covenant, and the continued employment of each
such executive officer does not subject the Company or its Subsidiaries to any liability
with respect to any of the foregoing matters, except as would not have a Material Adverse
Effect; (ii) Neither the Company nor its Subsidiaries is subject to, nor do any of its
employees benefit from, whether pursuant to applicable employment laws, regulations,
extension orders (Tzavei Harchava) or otherwise, any agreement, arrangement,
understanding or custom applying to all employees in Israel or to all employees in the
Company’s industry with respect to employment (including, without limitation,
termination thereof) other than the minimum benefits and working conditions required by
law to be provided pursuant to rules and regulations of the General Federation of Labor
(Histadrut), the Coordinating Bureau of Economic Organization and the
Industrialists’ Association or extension orders that apply to all employees in
Israel or to all employees in the Company’s industry in Israel. The severance pay
due to the Employees is fully funded or provided for in accordance with generally
accepted accounting principles, consistently applied; (iii) the Company and its
Subsidiaries are in compliance with all applicable laws and regulations respecting
employment and employment practices, terms and conditions of employment and wages and
hours, except where failure to be in compliance would not, either individually or in the
aggregate, reasonably be expected to result in a Material Adverse Effect.  



6







    3.13        Title.
The Company and its Subsidiaries have good and marketable title to all personal property
owned by them which is material to the business of the Company and its Subsidiaries, in
each case either free and clear of all liens, encumbrances and defects or such as do not
materially affect the value of such property and do not interfere with the use made of
such property by the Company and its Subsidiaries. Any real property and facilities held
under lease by the Company and its Subsidiaries are held by them under valid, subsisting
and enforceable leases with such exceptions as are not material and do not interfere with
the use made of such property and buildings by the Company and its Subsidiaries.  



    3.14        Intellectual
Property. (i) The Company, either directly or through its Subsidiaries, owns or
possesses sufficient rights to use all material patents, patent rights, trademarks,
copyrights, licenses, inventions, trade secrets, trade names and know-how (collectively,
“Intellectual Property”) described or referred to in the Company’s public
filings as owned or possessed by it, except where the failure to currently own or
possess would not have a Material Adverse Effect, (ii) to the knowledge of the Company,
the Company is not infringing, nor has it received any notice of, any asserted
infringement of, any rights of a third party with respect to any Intellectual Property
that, individually or in the aggregate, would have a Material Adverse Effect.  



    3.15        Tax
Status. The Company and each of its Subsidiaries (i) have made or filed all required
Israeli tax returns, reports and declarations, (ii) have paid all taxes and other
governmental assessments and charges that are material in amount, shown or determined to
be due on such returns, reports and declarations, except those being contested in good
faith, and (iii) have set aside on their books provision reasonably adequate for the
payment of all taxes for periods subsequent to the periods to which such returns, reports
or declarations apply. There are no unpaid taxes in any material amount claimed to be due
by the taxing authority of any jurisdiction, and the officers of the Company know of no
basis for any such claim.  



    3.16        Internal
Accounting Controls. The Company and each of its Subsidiaries maintain a system of
internal accounting controls sufficient to provide reasonable assurance that (i)
transactions are executed in accordance with management’s general or specific
authorizations, (ii) transactions are recorded as necessary to permit preparation of
financial statements in conformity with generally accepted accounting principles and to
maintain asset and liability accountability, (iii) access to assets or incurrence of
liabilities is permitted only in accordance with management’s general or specific
authorization and (iv) the recorded accountability for assets and liabilities is compared
with the existing assets and liabilities at reasonable intervals and appropriate action
is taken with respect to any difference. In addition, the Company has established and
maintains disclosure controls and procedures as defined in Rule 13a-14 under the 1934 Act
and in compliance with Rule 13a-15 under the 1934 Act.  



    3.17        No
General Solicitation; Placement Agent’s Fees. Neither the Company, nor any of
its affiliates, and any Person acting on their behalf, has engaged in any form of general
solicitation or general advertising or Directed Selling Efforts (within the meaning of
Regulation D or S, respectively) in connection with the offer or sale of the Securities.
Except for placement fees in the form of cash, ordinary shares or a combination thereof
to certain of the Investors (or their affiliates or related entities), the Company will
not be obligated for any finder’s fee or commission in connection with this
transaction. The Company shall be responsible for the payment of any placement agent’s
fees, financial advisory fees, or brokers’ commissions relating to or arising out of
the transactions contemplated hereby, if such claims shall be contrary to the foregoing
statement. The Company shall pay, and hold each Investor harmless against, any liability,
loss or expense (including, without limitation, attorney’s fees and out-of-pocket
expenses) arising in connection with any such claim, if such claim shall be contrary to
the foregoing statement.  



7







    3.18        Dilutive
Effect. The Company acknowledges that its obligation to issue the Warrant Shares upon
exercise of the Warrants in accordance with this Agreement and the Warrants is absolute
and unconditional regardless of the dilutive effect that such issuance may have on the
ownership interests of other shareholders of the Company  



    3.19        Transactions
with Affiliates. Except as set forth in the Company’s SEC Documents, none of the
officers, directors or employees of the Company is presently a party to any transaction
with the Company (other than for ordinary course services as employees, officers or
directors), including any contract, agreement or other arrangement providing for the
furnishing of services to or by, providing for rental of real or personal property to or
from, or otherwise requiring payments to or from any such officer, director or employee
or, to the knowledge of the Company, any corporation, partnership, trust or other entity
in which any such officer, director, or employee has a substantial interest or is an
officer, director, trustee or partner.  



    3.20        Compliance
with Law; Conduct of Business; Regulatory Permits. To the knowledge of the Company,
the business of the Company is conducted in accordance with applicable laws, except to
extent that, individually or in the aggregate, would not cause a Material Adverse Effect.
Neither the Company nor any of its Subsidiaries is in violation of any term of or in
default under their Articles of Association or Memorandum of Association or other
governing documents. Neither the Company nor any of its Subsidiaries is in violation of
any statute, ordinance, rule or regulation, or to the Company’s knowledge, any
judgment, decree or order applicable to the Company or any of its Subsidiaries, and
neither the Company nor any of its Subsidiaries conducts its business in violation of any
of the foregoing, except for possible violations which would not, individually or in the
aggregate, have a Material Adverse Effect. Without limiting the generality of the
foregoing, the Company is not in violation of any of the rules, regulations or
requirements of the Principal Markets and has no knowledge of any facts or circumstances
that would reasonably lead to delisting or suspension of the Ordinary Shares by the
Principal Markets in the foreseeable future. To the Company’s knowledge, the Company
possesses all certificates, authorizations and permits issued by the appropriate
regulatory authorities necessary to conduct its business, except where the failure to
possess such certificate, authorization or permit would not have, individually or in the
aggregate, a Material Adverse Effect, and the Company has not received any notice of
proceedings relating to the revocation or modification of any certificate, authorization
or permit. The Company is in compliance in all material respects with all conditions and
requirements stipulated by the instruments of approval granted to it with respect to the
“Approved Enterprise” status of any of the Company’s facilities by Israeli
laws and regulations relating to such “Approved Enterprise” status and other
tax benefits received by the Company, except for possible violations which would not,
individually or in the aggregate, have a Material Adverse Effect. The Company has not
received any notice of any proceeding or investigation relating to revocation or
modification of any “Approved Enterprise” status granted with respect to any of
the Company’s facilities which the Company believes could reasonably be expected to
result in material liability to the Company, except for possible violations which would
not, individually or in the aggregate, have a Material Adverse Effect, the Company is not
in violation of any condition or requirement stipulated by the instruments of approval
granted to the Company by the Office of Chief Scientist in the Israeli Ministry of
Industry and Trade (the “OCS”) and any applicable laws and regulations
with respect to any research and development grants given to it by such office as to
grants for projects that the OCS has not confirmed as having been closed. The Company has
or by Closing shall have (a) provided notice to the OCS, and (b) obtained approval of the
Investment Center, to the transactions contemplated hereunder. All information supplied
by the Company with respect to such applications was true, correct and complete in all
material respects when supplied to the appropriate authorities. The Company’s
contingent liabilities to the OCS are disclosed in the Company’s SEC Documents.  



8







    3.21        No
Undisclosed Events, Liabilities, Developments or Circumstances. No event, liability,
development or circumstance has occurred or exists, or is contemplated to occur (other
than the transactions contemplated hereby), with respect to the Company or any of its
Subsidiaries or their respective business, properties, operations or financial condition,
that would be required to be disclosed by the Company under applicable securities laws in
an immediate report to the SEC or the ISA.  



    3.22        Sarbanes-Oxley
Act. The Company is in compliance with any and all applicable requirements of the
Sarbanes-Oxley Act of 2002 that are applicable to the Company as a foreign private issuer
and as are effective as of the date hereof, and any and all applicable rules and
regulations promulgated by the SEC thereunder that are effective as of the date hereof,
except where such noncompliance would not have a Material Adverse Effect.  



    3.23        Form
F-3 Eligibility. The Company is eligible to register the Ordinary Shares for resale
by the Investors under Form F-3 promulgated under the 1933 Act. The Company qualifies as
a “foreign private issuer” as such term is defined in the 1934 Act.  



    3.24        Disclosure.
The representations and warranties of the Company contained in this Section 3 as of
the date hereof and as of the Closing, do not contain any untrue statement of a material
fact or omit to state a material fact necessary to make the statements herein, in light
of the circumstances under which they are made, not misleading. The Company acknowledges
and agrees that the Investors have not made any representations or warranties with
respect to the transactions contemplated hereby other than those specifically set forth
in Section 4.  



     4.    
          REPRESENTATIONS OF THE INVESTORS. Each of the Investors, severally
          represents to the Company that: 



    4.1        Enforceability.
If such Investor is a corporation, partnership, limited liability company, trust or other
entity, (i) it is authorized and qualified and has full right and power to become an
investor in the Company, is authorized to purchase the Shares and to perform its
obligations pursuant to the provisions hereof, (ii) the person signing the Transaction
Documents and any other instrument executed and delivered therewith on behalf of such
Investor has been duly authorized by such entity and has full power and authority to do
so, and (iii) such Investor has not been formed for the specific purpose of acquiring an
interest in the Company.  



9







    4.2        Restrictions
on Transferability and Hedging.  



		    4.2.1        Such
Investor understands that (i) the Shares have not yet been registered under the
Securities Act of 1933, or under the laws of any other jurisdiction; (ii) such Shares
cannot be sold, transferred or otherwise disposed of unless they are subsequently
registered under the Securities Act and, where required, under the laws of other
jurisdictions or unless an exemption from registration is then available; (iii) there is
now no registration statement on file with the Securities and Exchange Commission with
respect to the Shares to be purchased by the Investor.  







		    4.2.2        Such
Investor acknowledges and agrees that the certificates representing the Shares shall bear
restrictive legends as counsel to the Company may determine are necessary or appropriate,
including without limitation, legends under applicable securities laws similar to the
following:  







	 	
“The
shares represented by this certificate have not been registered under the Securities Act
of 1933. The shares have been acquired for investment and may not be sold, transferred,
assigned or otherwise disposed of in the absence of an effective registration statement
with respect to the shares evidenced by this certificate, filed and made effective under
the Securities Act of 1933, or an opinion of the Company’s counsel that registration
under such Act is not required.” 






		    4.2.3        The
Company will not register any transfer of Shares not made pursuant to registration under
the Securities Act, or pursuant to an available exemption from registration.  







		    4.2.4        Each
of the Investors agrees not to engage in hedging transactions with regard to the Shares
sold pursuant to this Agreement.  







    4.3        Offshore
Transaction. Such Investor is not a “U.S. Person”, as such term is defined
in Regulation S under the Securities Act of 1933 (“Reg. S”), its principal
address is outside the United States and it has present intention of becoming a resident
of (or moving its principal place of business to) the United States. Such Investor was
located outside the United States at the time any offer to sell and any other action in
connection with such offer and sale was made to such Investor and at the time that the
buy order was originated by the Investor. The Shares are being acquired solely for such
Investor’s own account, and in no event and without derogating from the foregoing,
for the account or the benefit of a U.S. person. The Investor shall comply with the
applicable distribution compliance periods pursuant to Reg. S.  



    4.4        Investment
Purposes. The Shares are being acquired for investment purposes. The Shares are not
being purchased with a view to, or for sale in connection with, any distribution or other
disposition thereof. The Investor has no present plans to enter into any contract,
undertaking, agreement or arrangement for any such resale, distribution or other
disposition and it will not divide its interest in the Company’s Shares with others,
resell or otherwise distribute the Shares in violation of federal or state US Securities
laws or the Israeli Securities Law.  




10







    4.5        Information
and Advice. Without derogating from the Investor’s right to rely on the
representations and warranties of the Company set forth in Section 3 above:  



		    4.5.1        Such
Investor has carefully reviewed and understands the risks of a purchase of the Shares. In
connection with such Investor’s investment in the Company, it has obtained the
advice of its own investment advisors, counsel and accountants (the “Advisors”).
The Investor and its Advisors have reviewed the Company’s public filings and have
been furnished with all materials relating to the Company or the offering of the Shares
(the “Offering”) that they have requested. The Investor and its Advisors
have been afforded the opportunity to ask questions of the Company concerning the
financial and other affairs of the Company and the conditions of the Offering and to
obtain any additional information necessary to verify the accuracy of any representations
or information set forth with respect to the Shares.  







		    4.5.2        The
Company has answered all reasonable inquiries that such Investor and its Advisors have
made concerning the Company or any other matters relating to the creation and operations
of the Company and the terms and conditions of the Offering.  







    4.6        Sophistication
and Risk.  



		    4.6.1        It
has such knowledge and experience in financial and business matters, that it is capable
of evaluating, and has evaluated the merits and risks of the Offering. By reason of its
business or financial experience, it has the capacity to protect its interests in
connection with an investment in the Company.  







		    4.6.2        It
understands that no Israeli or U.S. federal or state agency has passed upon the Shares or
made any finding or determination as to the fairness of the transactions contemplated in
the Transaction Documents.  







		    4.6.3        It
understands that the Shares are speculative investments, which involve a high degree of
risk, including the risk that such Investor might lose its entire amount invested in the
Company.  







		    4.6.4        It
understands that any tax benefits that may be available to such Investor may be lost
through adoption of new laws, amendments to existing laws or regulations, or changes in
the interpretation of existing laws and regulations.  







		    4.6.5        It
has the financial ability to bear the economic risk of its investment in the Company and
has adequate net worth and means of providing for the Investor’s current needs and
contingencies to sustain a complete loss of the Investor’s investment and has no
need for liquidity in the Investor’s investment in the Company.  







		    4.6.6        It
is an “Accredited Investor,” as such term is defined in Rule 501 of Regulation
D under the Securities Act of 1933.  







    4.7        No
solicitation. At no time was such Investor presented with or solicited by any
leaflet, public promotional meeting, newspaper or magazine article, radio or television
advertisement or any other form of general advertising or general solicitation concerning
the Offering.  



11







    4.8        Broker-Dealer.
The Investor is not a broker-dealer, nor is it an affiliate of any broker-dealer.  



    4.9        Further
Indebtedness. Such Investor acknowledges that no provision of the Transaction
Documents executed and delivered by the Company restricts, or shall be construed to
restrict, in any way the ability of the Company to incur indebtedness or to issue share
capital or other equity securities (or securities convertible into equity securities) of
the Company or to grant liens on its property and assets.  



    4.10        Voting
and/or Investment Control over the Investors. Each Investor has made available to the
Company a list of individuals who have or share voting and/or investment control over
such Investor. The Investor shall update such list as reasonably requested by the Company
to comply with request for such information from any regulatory body.  



    4.11        Independent
Investment. No Investor has agreed to act with any other Person for the purpose of
acquiring, holding, voting or disposing of the Shares purchased hereunder, and each
Investor is acting independently with respect to its investment in the Shares. The
obligations of each Investor under any Transaction Document are several and not joint
with the obligations of any other Investor, and no Investor shall be responsible in any
way for the performance of the obligations of any other Investor under any Transaction
Document. Nothing contained herein or in any Transaction Document, and no action taken by
any Investor pursuant thereto, shall be deemed to constitute the Investors, or any of
them, as a partnership, an association, a joint venture or any other kind of entity, or
create a presumption that the Investors, or any of them, are in any way acting in concert
or as a group with respect to such obligations or the transactions contemplated by the
Transaction Documents.  



    4.12        Holdings.
Schedule 1 attached hereto reflects the holdings of the Company’s shares by
each Investor and its affiliates as of the date hereof, and as of the Closing.  



    4.13        Availability
of Exemptions. Each Investor understands that the Shares are being offered and sold
in reliance on a transactional exemption or exemptions from the registration requirements
of Israeli and U.S. Federal and state securities laws and the Company is relying upon the
truth and accuracy of the representations, warranties, agreements, acknowledgments and
understandings of such Investor set forth herein in order to determine the applicability
of such exemptions and the suitability of such Investor to acquire the Shares.  



    4.14        Disclosure.
The representations and warranties of each Investor contained in this Section 4 as
of the date hereof and as of the Closing, do not contain any untrue statement of a
material fact or omit to state a material fact required to be stated herein or necessary
to make the statements herein, in light of the circumstances under which they are made,
not misleading. Each Investor understands and confirms that the Company will rely on the
foregoing representations in effecting the transaction contemplated in the Transaction
Documents and other transactions in securities of the Company.  








5.    CONDITIONS
OF EACH INVESTOR’S OBLIGATION AT THE CLOSING. The           obligation of each
Investor to purchase its respective Shares is subject to the           fulfillment or
waiver by such Investor prior to or on the date of the Closing of           the
conditions set forth in this Section 5. In the event that any such condition           is
not satisfied to the satisfaction of an Investor, then such non satisfied
          Investor shall not be obligated to proceed with the purchase of such
securities.  



12







    5.1        Representations
and Warranties. The representations and warranties of the Company under this
Agreement shall be true in all material respects as of the Closing, with the same effect
as though made on and as of such date.  



    5.2        Compliance
with Agreements. The Company shall have performed and complied in all material
respects with all agreements or conditions required by this Agreement to be performed and
complied with by it prior to or as of the Closing.  



    5.3        Warrants.
As of the Closing, the Warrants shall have been executed and delivered by the Company and
each Investor.  



    5.4        Issuance
of Shares. As of the Closing, the Shares purchased by the Investors shall have been
duly issued to the Investors.  



    5.5        Registration
Rights Agreement. As of the Closing, the Registration Rights Agreement in the form
attached hereto as Exhibit A (the “Registration Rights Agreement”) shall
have been executed and delivered by the Company and each Investor.  



    5.6        No
Injunction. No statute, rule, regulation, executive order, decree, ruling or
injunction shall have been enacted, entered, promulgated or endorsed by any court or
governmental authority of competent jurisdiction which prohibits the consummation of any
of the transactions contemplated by this Agreement.  



     6.    
          CONDITIONS OF THE COMPANY’S OBLIGATION AT THE CLOSING. The
          obligation of the Company to issue the Shares to the Investors at the Closing is
          subject to the fulfillment or waiver by the Company prior to or on the Closing
          of the conditions set forth in this Section 6. In the event that any such
          condition is not satisfied to the satisfaction of the Company, then the Company
          shall not be obligated to proceed with the sale of the securities under this
          Agreement. 



    6.1        Representations
and Warranties. The representations and warranties of all the Investors under this
Agreement shall be true in all material respects as of the Closing, with the same effect
as though made on and as of such date.  



    6.2        Compliance
with Agreements. All Investors shall have performed and complied in all respects with
all agreements or conditions required by this Agreement to be performed and complied with
by it prior to or as of the Closing.  



    6.3        Registration
Rights Agreement. As of the Closing, the Registration Rights Agreement shall have
been executed and delivered by all of the Investors.  



    6.4        No
Injunction. No statute, rule, regulation, executive order, decree, ruling or
injunction shall have been enacted, entered, promulgated or endorsed by any court or
governmental authority of competent jurisdiction which prohibits the consummation of any
of the transactions contemplated by this Agreement.  



13







    6.5        Delivery
of Purchase Amount. Each of the Investors shall have delivered to the Company its
respective Purchase Amount for the Shares at the Closing Date.  



    6.6        Government
Approvals. The Company shall have received all necessary governmental approvals with
respect to the transactions contemplated hereby. The Investor shall have executed any
confirmations required by the Office of Chief Scientist.  



    6.7        Notices
to Nasdaq and the TASE. The Company shall have made all required filings of notices
with Nasdaq and the Tel Aviv Stock Exchange. The Company shall use its best efforts to
complete such filings.  



     7.    
          CONFIDENTIALITY. Any information disclosed to each of the Investors or
          their respective Advisors, which have not previously been made available to the
          general public by the Company, if any, shall be considered Confidential
          Information. Each Investor acknowledges the confidential nature of the
          Confidential Information it may have received, and agrees that the Confidential
          Information is the valuable property of the Company. Each Investor agrees that
          it and its Advisors shall not reproduce any of the Confidential Information
          without the prior written consent of the Company, nor shall they use any
          Confidential Information for any purpose except as permitted by and in the
          performance of this Agreement, or divulge all or any part of the Confidential
          Information to any third party. The confidentiality obligations undertaken by
          the Investors hereunder will remain in full force and effect regardless of the
          execution and consummation or termination of this Agreement. 



8.     MISCELLANEOUS.  



    8.1        Expenses.
At the Closing, the Company shall reimburse the Investors for reasonable legal expenses
of one counsel (Yigal Arnon & Co.) incurred in connection with the preparation of the
Transaction Documents in an amount to be agreed to between the parties.  



    8.2        Amendments. This
Agreement may be modified, supplemented or amended only by a written instrument executed
by the parties to this Agreement.  



    8.3        Notices.
Any notice that is required or provided to be given under this Agreement shall be deemed
to have been sufficiently given and received for all purposes, (i) when delivered in
writing by hand, upon delivery; (ii) if sent via facsimile, upon transmission and
electronic confirmation of receipt (and if transmitted and received on a non-business
day, on the first business day following transmission and electronic confirmation of
receipt), (iii) seven (7) business days (and fourteen (14) business days for
international mail) after being sent by certified or registered mail, postage and charges
prepaid, return receipt requested, or (iv) three (3) business days after being sent by
internationally overnight delivery providing receipt of delivery, to the following
addresses:  



14







	 	
if
to the Company, B.O.S Better Online Solutions Ltd., 20 Freiman Street, Rishon Lezion,
75101 Israel Attn: Mr. Eyal Cohen, CFO, facsimile: (972) 3 954-1003, with a copy to Amit,
Pollak Matalon & Co., NITSBA Tower, 17 Yitzhak Sadeh St., Tel-Aviv 67775 Israel attn:
Shlomo Landress, Adv. Fax: (972) 3 568-9001; or at any other address designated by the
Company to the Investors in writing;  






	 	
if
to an Investor, to 2 Kaufman St., 9th Floor, Tel Aviv, Israel 68012, Fax: +972
3 516 with a copy (which shall not constitute notice) to Yigal Arnon & Co., 1 Azrieli
Center, Tel Aviv 67021 Israel attn: Peter Sugarman, Adv. Fax (972) 3 608-7714 or at any
other address designated by the Investors to the Company in writing.  






    8.4        Survival
of Representations and Warranties. All representations and warranties contained
herein or in any Transaction Document or in any other certificate delivered hereunder or
thereunder shall survive after the execution and delivery of this Agreement or such
certificate or document, as the case may be, for a period of 24 months from the date
hereof. All covenants and agreements in any Transaction Documents shall survive in
accordance with their terms. This Section shall survive the termination of this Agreement
for any reason.  



    8.5        Delays
or Omissions; Waiver. Except as expressly provided herein, no delay or omission to
exercise any right, power or remedy accruing to any party under this Agreement shall
impair any such right, power or remedy of such party nor shall it be construed to be a
waiver of any breach or default, or an acquiescence thereto, or of a similar breach or
default thereafter occurring; nor shall any waiver of any single breach or default be
deemed a waiver of any other breach or default theretofore or thereafter occurring. Any
waiver, permit, consent or approval of any kind or character on the part of any party
hereto of any breach or default under this Agreement, or any waiver on the part of any
party of any provisions or conditions of this Agreement, must be in writing and shall be
effective only to the extent specifically set forth in such writing.  



    8.6        Other
Remedies. Any and all remedies herein expressly conferred upon a party shall be
deemed cumulative with, and not exclusive of, any other remedy conferred hereby or by law
on such party, and the exercise of any one remedy shall not preclude the exercise of any
other.  



    8.7        Entire
Agreement. This Agreement and the exhibits and schedules hereto, constitute the
entire understanding and agreement of the parties hereto with respect to the subject
matter hereof and thereof and supersede all prior and contemporaneous agreements or
understandings, inducements or conditions, express or implied, written or oral, between
the parties with respect hereto and thereto.  



    8.8        Headings. All
section headings herein are inserted for convenience only and shall not modify or affect
the construction or interpretation of any provision of this Agreement.  



    8.9        Severability.
Should any one or more of the provisions of this Agreement (including its exhibits and
schedules) or of any agreement entered into pursuant to this Agreement be determined to
be illegal or unenforceable, all other provisions of this Agreement and of each other
agreement entered into pursuant to this Agreement, shall be given effect separately from
the provision or provisions determined to be illegal or unenforceable and shall not be
affected thereby. The parties further agree to replace such void or unenforceable
provision of this Agreement with a valid and enforceable provision, which will achieve,
to the extent possible, the economic, business and other purposes of the void or
unenforceable provision.  



15







    8.10        Assignment.
This Agreement may not be assigned in whole or in part by any Investor without the prior
written consent of the Company.  



    8.11        Governing
Law and Venue. This Agreement shall be construed in accordance with and governed by
the internal laws of the State of Israel, without regard to conflict of laws provisions.
Any dispute arising under or in relation to this Agreement shall be adjudicated in the
competent court of Tel Aviv-Jaffa district only, and each of the parties hereby submits
irrevocably to the exclusive jurisdiction of such court.  



    8.12        Counterparts.
This Agreement may be executed concurrently in any number of counterparts, each of which
shall be deemed an original, but all of which together shall constitute one and the same
instrument.  



    8.13        Further
Actions. At any time and from time to time, each party agrees, without further
consideration, to take such actions and to execute and deliver such documents as may be
reasonably necessary to effectuate the purposes of this Agreement.  



(Remainder of page intentionally
left blank.)  



16








IN WITNESS WHEREOF, the undersigned
have executed and delivered this Agreement as of the date first set forth above.  








		
	B.O.S BETTER ON LINE SOLUTIONS LTD.
	 
	By:	____________________________
	 
	Name:	____________________________
	 
	Title:	____________________________
	 
	____________________________
	[Name of Investor]
	 
	By:	____________________________
	 
	Name:	____________________________
	 
	Title:	____________________________






17
















Schedule 1  









	INVESTOR’S NAME

AND ADDRESS
	PURCHASE

AMOUNT
	NO. OF SHARES

PURCHASED
	NO. OF

WARRANTS
	PRE-CLOSING HOLDINGS
	POST-CLOSING HOLDINGS

	Amount
	Percent
	Amount
	Percent

	 							
								
								
	K.G.M. 	 	 	 		 	 		 	 		 	 		 	 		 	 		 	 		 
	Provident	 	 
	Fund	 	 
	Address: 	 	 
	2 Kaufman St.,	 	 
	Tel Aviv 68012 	 	 	$	   455,952	 	 	189,980	 	 	123,487	 	 	-	 	 	0.00	 	 	189,980	 	 	1.76	%
	 	 	 
	Yuvalim	 	 
	Provident &	 	 
	Hishtalmu Fund	 	 
	Address: 	 	 
	2 Kaufman St.,	 	 
	Tel Aviv 68012	 	 	$	   264,096	 	 	110,040	 	 	71,526	 	 	97,239	 	 	0.97	%	 	207,279	 	 	1.92	%
	 	 	 
	Yuvalim Pension	 	 
	Fund	 	 
	Address: 	 	 
	2 Kaufman St.,	 	 
	Tel Aviv 68012	 	 	$	   280,224	 	 	116,760	 	 	75,894	 	 	247,144	 	 	2.48	%	 	363,904	 	 	3.37	%
	 	 	 
	Catalyst Fund LP	 	 
	Address: 	 	 
	3 Daniel Frish	 	 
	Street	 	 
	Tel Aviv 64731	 	 	$	 1,000,272	 	 	416,780	 	 	270,907	 	 	1,675,465	 	 	16.79	%	 	2,092,245	 	 	19.35	%
	 	 	 
	Additional 	 	 
	Investors 	 	 








18
















EXHIBIT A



REGISTRATION RIGHTS
AGREEMENT 



19







REGISTRATION RIGHTS
AGREEMENT 



        This
Registration Rights Agreement is made and entered into as of December 10, 2007 by and
among B.O.S. Better Online Solutions Ltd., an Israeli company (the
“Company”), and the entities listed in Schedule 1 (collectively, the “Investors” and each, an
“Investor”). 



        WHEREAS,
pursuant to that certain Securities Purchase Agreement (the “Purchase
Agreement”) between the Company and the Investors dated as of December 10, 2007,
Buyer issued to each Investor ordinary shares, each with a nominal value of NIS 4.00 per
share, of the Company (“Ordinary Shares”) and Warrants (the
“Warrants”) for the purchase of Ordinary Shares of the Company; and 



        WHEREAS,
the parties desire to set forth certain matters regarding ownership of the shares of the
Company, as more fully set forth herein. 



        NOW,
THEREFORE, the parties hereto agree as follows: 



1. DEFINITIONS. 



        For
purposes of this Agreement, the following terms shall have the meanings set forth below: 



	 	1.1 	“Holders” means
any Investor, transferee or assignee to whom any of the Investors assigns its rights, in
whole or in part, and any transferee or assignee thereof to whom a transferee or assignee
assigns its rights, in accordance with Section 9. 






	 	1.2 	“ISA” means
the Israel Securities Authority or any similar or successor agency of Israel
administering the Israel Securities Law. 






	 	1.3 	“Israel
Securities Law” means the Israel Securities Law, 5728-1968 (including the
regulations promulgated thereunder), as amended. 






	 	1.4 	"1933
Act" means the U.S. Securities Act of 1933, as amended, and the rules and regulations
thereunder, or any similar successor statute. 






	 	1.5 	"1934
Act" means the U.S. Securities Exchange Act of 1934, as amended, and the rules and
regulations thereunder, or any similar successor statute. 






	 	1.6 	“Person” means
an individual, a limited liability company, a partnership, a joint venture, a
corporation, a trust, an unincorporated organization and a government or any department
or agency thereof. 






20







	 	1.7 	“Register”,
“registered”, and “registration” refer to a
registration effected by preparing and filing a registration statement in compliance with
the 1933 Act and the effectiveness of such registration statement in accordance with the
1933 Act or the equivalent actions under the laws of another jurisdiction. 






	 	1.8 	“Registrable
Securities” means any Shares held by any Investor and any other securities
issued by the Company to any Investor by means of exchange, reclassification, dividend,
distribution, split-up, combination, subdivision, recapitalization, merger, spin-off,
reorganization, contractual obligation or otherwise, prior to the date the Registration
Statement was filed with the SEC. 






	 	1.9 	“Registration
Statement” means a registration statement or registration statements of the
Company covering Registrable Securities filed with (a) the SEC under the 1933 Act, and
(b) the ISA under the Israel Securities Law, to the extent required under the Israel
Securities Law, so as to allow the Holder to freely resell the Registrable Securities in
Israel, including on the TASE. 






	 	1.10 	“SEC” means
the United States Securities and Exchange Commission or any similar or successor agency
of the United States administering the 1933 Act. 






	 	1.11 	“Shares” means
the Ordinary Shares issued to the Investors under the Purchase Agreement and any Warrant
Shares purchased by the Investors under the terms of the Warrant. 






	 	1.12 	"Warrant
Shares" means Ordinary Shares purchased by the Investors pursuant to the
exercise of the Warrant. 







	2. 	 LISTING
& REGISTRATION OF THE SHARES 






	 	2.1 	The
Company shall prepare, and, as soon as practicable but in no event later than 150 days
after the date of this Agreement (the “Deadline”) file with the SEC (and
make the required corresponding filings with the ISA) a Registration Statement on Form
F-3 covering the resale of all of the then Registrable Securities that are not already
registered. The Company shall use commercially reasonable efforts to have the
Registration Statement declared effective by the SEC as soon as possible after such
filing with the SEC. 






	 	2.2 	In
the event that Form F-3 shall not be available for the registration of the resale of
Registrable Securities hereunder, the Company shall register the resale of the
Registrable Securities on another appropriate form in accordance with its undertakings
hereunder. 






21







	 	2.3 	The
Company represents and warrants to the Investors that the Company is not a party to any
agreement that conflicts in any manner with the Investors’ rights to cause the
Company to register Registrable Shares pursuant to this Agreement. The Investors
acknowledges that the Company had entered into a Registration Rights Agreement with S.G.
Private Banking (Suisse) S.A. providing such investor with incidental registration
rights. 






	3.  	RELATED
OBLIGATIONS. 






	 	3.1 	Following
the filing and effectiveness of each Registration Statement with the SEC pursuant to
Section 2.1, the Company shall use commercially reasonable efforts to keep the
Registration Statement effective pursuant to Rule 415 of the 1933 Act at all times until
the earlier of (i) the date as of which all of the Registrable Securities covered by such
Registration Statement may be sold without restriction pursuant to Rule 144(k) under the
1933 Act (ii) the date on which the Holders shall have sold all the Registrable
Securities covered by such Registration Statement; or (iii) the fifth anniversary of the
date hereof (the “Registration Period”). The Company shall ensure that
such Registration Statement (including any amendments or supplements thereto and
prospectuses contained therein) shall not contain any untrue statement of a material fact
or omit to state a material fact required to be stated therein, or necessary to make the
statements therein, in light of the circumstances in which they were made, not
misleading, subject to Section 3.5 below. 






	 	3.2 	The
Company shall prepare and file with the SEC and the ISA (to the extent required) such
amendments (including post-effective amendments) and supplements to each Registration
Statement and the prospectus used in connection with such Registration Statement, as may
be necessary to keep such Registration Statement effective at all times during the
Registration Period, and, during such period, comply with the provisions of the 1933 Act
and the Israel Securities Law with respect to the disposition of all Registrable
Securities of the Company covered by such Registration Statement. In the case of
amendments and supplements to a Registration Statement which are required to be filed
pursuant to the Agreement (including pursuant to this Section 3.2 by reason of the
Company filing a report on Form 20-F, Form 6-K or any analogous report under the 1934
Act), the Company shall have incorporated such report by reference into the Registration
Statement, if applicable, or shall file such amendments or supplements with the SEC (and
the ISA) as may be required to maintain the Registration Statement effective during the
Registration Period. 






22







	 	3.3 	The
Company shall furnish each Holder whose Registrable Securities are included in any
Registration Statement, without charge, (i) promptly after the same is prepared and filed
with the SEC, at least three (3) copies of such Registration Statement and any
amendment(s) thereto, including financial statements and schedules, all documents
incorporated therein by reference, all exhibits and each preliminary prospectus (or such
other number of copies as such Holder may reasonably request), (ii) upon the
effectiveness of any Registration Statement, at least ten (10) copies of the prospectus
included in such Registration Statement and all amendments and supplements thereto (or
such other number of copies as such Holder may reasonably request) and (iii) such other
documents, including copies of any preliminary or final prospectus and of any
Registration Statements and prospectuses filed with the ISA, as such Holder may
reasonably request from time to time in order to facilitate the disposition of the
Registrable Securities owned by such Holder. 






	 	3.4 	The
Company shall use its commercially reasonable efforts to (i) register and qualify, unless
an exemption from registration and qualification applies, the resale by the Holders of
the Registrable Securities covered by a Registration Statement under such other
securities or “blue sky” laws of all the states of the United States, (ii)
prepare and file in those jurisdictions, such amendments (including post-effective
amendments) and supplements to such registrations and qualifications as may be necessary
to maintain the effectiveness thereof during the Registration Period, (iii) take such
other actions as may be necessary to maintain such registrations and qualifications in
effect at all times during the Registration Period, and (iv) take all other actions
reasonably necessary or advisable to qualify the Registrable Securities for sale in such
jurisdictions; provided, however, that the Company shall not be required in connection
therewith or as a condition thereto to (x) qualify to do business in any jurisdiction
where it would not otherwise be required to qualify but for this Section 3.4, or (y) file
a general consent to service of process in any such jurisdiction. The Company shall
promptly notify each Holder who holds Registrable Securities of the receipt by the
Company of any notification with respect to the suspension of the registration or
qualification of any of the Registrable Securities for sale under the securities or “blue
sky” laws of any jurisdiction in the United States or its receipt of actual notice of
the initiation or threatening of any proceeding for such purpose. 






23







	 	3.5 	The
Company shall notify each Holder in writing of the happening of any event, (a “Discontinuation
Event”) as promptly as practicable after becoming aware of such event, as a result
of which the prospectus included in a Registration Statement, as then in effect, includes
an untrue statement of a material fact or an omission to state a material fact required
to be stated therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading. The Company shall use its
commercially reasonable efforts to minimize the period of time during which a
Registration Statement includes an untrue statement of a material fact or omission to
state a material fact required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they were made, not misleading. The
Company shall promptly notify each Holder in writing (i) when a prospectus or any
prospectus supplement or post-effective amendment has been filed so that the Registration
Statement does not include an untrue statement of a material fact or an omission to state
a material fact required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they were made, not misleading, and
when a Registration Statement or any post-effective amendment has become effective, (ii)
of any request by the SEC or the ISA for amendments or supplements to a Registration
Statement or related prospectus or related information, and (iii) of the Company’s
reasonable determination that a post-effective amendment to a Registration Statement
would be appropriate. 






	 	3.6 	The
Company shall use its commercially reasonable efforts to prevent the issuance of any stop
order or other suspension of effectiveness of a Registration Statement, or the suspension
of the qualification of any of the Registrable Securities for sale in any jurisdiction
and, if such an order or suspension is issued, to obtain the withdrawal of such order or
suspension at the earliest possible moment and to notify each Holder who holds
Registrable Securities being sold of the issuance of such order and the resolution
thereof or its receipt of actual notice of the initiation or threat of any proceeding for
such purpose. 






	 	3.7 	The
Company shall use its commercially reasonable efforts to cause all the Registrable
Securities covered by a Registration Statement to be listed on each securities exchange
on which securities of the same class or series issued by the Company are then listed,
including the NASDAQ and the TASE and the Company shall, not later than the effective
date of a Registration Statement, deliver to the Holders a copy of the approval of the
TASE (and/or any other exchange, if applicable) to the listing of the Registrable
Securities covered by such Registration Statement on such exchange. 






24







	 	3.8 	The
Company shall cooperate with the Holders who hold Registrable Securities being offered
and, to the extent applicable, facilitate the timely preparation and delivery of
certificates (not bearing any restrictive legend) representing the Registrable Securities
to be offered pursuant to a Registration Statement and enable such certificates to be in
such denominations or amounts, as the case may be, as the Holders may reasonably request
and registered in such names as the Holders may request. 






	 	3.9 	The
Company shall provide a transfer agent and registrar of all Registrable Securities and a
CUSIP number not later than the effective date of the applicable Registration Statement. 






	 	3.10 	If
requested by a Holder, the Company shall, to the extent necessary for compliance with the
Securities Act of 1933: (i) as soon as practicable incorporate in a prospectus supplement
or post-effective amendment such information as a Holder requests to be included therein,
information with respect to the number of Registrable Securities being offered or sold,
the purchase price being paid therefor and any other terms of the offering of the
Registrable Securities to be sold in such offering; (ii) as soon as practicable make all
required filings of such prospectus supplement or post-effective amendment after being
notified of the matters to be incorporated in such prospectus supplement or
post-effective amendment; and (iii) as soon as practicable, supplement or make amendments
to any Registration Statement if reasonably requested by a Holder of such Registrable
Securities. 






	 	3.11 	The
Company shall comply with all applicable securities laws and rules and regulations of the
SEC and the ISA. 






	4. 	OBLIGATIONS
OF THE HOLDERS. 






	  	9.       
Each
Holder agrees that, upon receipt of any notice from the Company of the
          happening of any event of the kind described in the first sentence of Section
          3.5 or in Section 3.6, such Holder will immediately discontinue disposition of
          Registrable Securities pursuant to any Registration Statement(s) covering such
          Registrable Securities until such Holder’s receipt of the copies of the
          supplemented or amended prospectus contemplated by Section 3.5 or receipt of
          notice that no supplement or amendment is required.  






	5. 	EXPENSES
OF REGISTRATION. 






	  	10.        
All
expenses, other than: (i) underwriting discounts and commissions and (ii) if
          applicable, counsel(s) to Holders, incurred in connection with registrations,
          filings or qualifications pursuant to Sections 2 and 3, including, without
          limitation, all registration, listing and qualifications fees, printers and
          accounting fees, fees and disbursements of counsel to the Companyshall
          be paid by the Company.  






25







	6. 	INDEMNIFICATION. 






	11. 	In
the event any Registrable Securities are included in a Registration Statement
          under this Agreement: 






	 	6.1 	To
the fullest extent permitted by law, the Company will, and hereby does, indemnify, hold
harmless and defend each Holder, the directors, officers, partners, employees, agents,
representatives of, and each Person, if any, who controls any Holder within the meaning
of the 1933 Act or 1934 Act (each, an “Indemnified Person”), against any
losses, claims, damages, liabilities, judgments, fines, penalties, charges, costs,
reasonable attorneys’ fees, amounts paid in settlement or expenses, joint or
several, (collectively, “Claims”) incurred in defending any action,
claim, suit, inquiry, proceeding, investigation by or before any court or governmental,
administrative or other regulatory agency, body or the SEC or the ISA, whether pending or
threatened, whether or not a Person to be indemnified is or may be a party thereto (“Indemnified
Damages”), to which any of them may become subject insofar as such Claims (or
actions or proceedings, whether commenced or threatened, in respect thereof) arise out of
or are based upon: (i) any untrue statement or alleged untrue statement of a material
fact in a Registration Statement, preliminary prospectus, final prospectus or “free
writing prospectus” (as such term is defined in Rule 405 under the 1933 Act) or any
post-effective amendment thereto or in any filing made in connection with the
qualification of the offering under the securities or other “blue sky” laws of
any jurisdiction in which Registrable Securities are offered (“Blue Sky Filing”),
or the omission or alleged omission to state a material fact required to be stated
therein or necessary to make the statements therein not misleading, or (ii) any violation
by the Company of the 1933 Act, the 1934 Act, the Israel Securities Law or other federal
or state or Israeli securities law applicable to the Company and relating to any action
or inaction required of the Company in connection with such registration (“Violations”).
Subject to Section 6.3, the Company shall reimburse the Indemnified Persons promptly as
such expenses are incurred and are due and payable, for any legal fees or other
reasonable expenses incurred by them in connection with investigating or defending any
such Claim. Notwithstanding anything to the contrary contained herein, the
indemnification agreement contained in this Section 6.1: shall not apply: (i) to a Claim
by an Indemnified Person arising out of or based upon a Violation which occurs in
reliance upon and in conformity with information furnished in writing to the Company by
such Indemnified Person expressly for inclusion in any such Registration Statement,
preliminary prospectus, final prospectus or free writing prospectus or any such amendment
thereof or supplement thereto; (ii) to amounts paid in settlement of any Claim if such
settlement is effected without the prior written consent of the Company, which consent
shall not be unreasonably withheld; and (iii) to the use of the Registration Statement or
the related Prospectus following a Discontinuation Event, provided the Indemnified Person
received prior notice of such Discontinuation Event; or (iv) if the Indemnified Person
fails to deliver a prospectus, as then amended or supplemented, provided that the Company
shall have delivered to the Indemnified Person such prospectus. Such indemnity shall
remain in full force and effect regardless of any investigation made by or on behalf of
the Indemnified Person and shall survive the transfer of the Registrable Securities by
the Holders pursuant to Section 9. 






26







	 	6.2 	In
connection with any Registration Statement in which a Holder is participating, each such
Holder agrees, severally and not jointly, to indemnify, hold harmless and defend, to the
same extent and in the same manner as is set forth in Section 6.1, the Company, each of
its directors, each of its officers who signs the Registration Statement, each Person, if
any, who controls the Company within the meaning of the 1933 Act or the 1934 Act (each an
“Indemnified Party”), against any Claim or Indemnified Damages to which
any of them may become subject, under the 1933 Act, the 1934 Act or otherwise, insofar as
such Claim or Indemnified Damages arise out of or are based upon any Violation, in each
case to the extent, and only to the extent, that such Violation occurs in reliance upon
and in conformity with written information furnished to the Company by such Holder
expressly for inclusion in Registration Statement, preliminary prospectus, final
prospectus or free writing prospectus and, subject to Section 6.3, such Holder will
reimburse any legal or other expenses reasonably incurred by an Indemnified Party in
connection with investigating or defending any such Claim; provided, however, that the
indemnity agreement contained in this Section 6.2 and the agreement with respect to
contribution contained in Section 7 shall not apply to amounts paid in settlement of any
Claim if such settlement is effected without the prior written consent of such Holder;
provided, further, however, that the Holder shall be liable under this Section 6 for only
that amount of a Claim or Indemnified Damages as does not exceed the higher of: (i) the
net proceeds to such Holder as a result of the sale of Registrable Securities pursuant to
such Registration Statement and (ii) the Purchase Amount (as defined in the Purchase
Agreement) and the Exercise Price (as defined in the Warrant) paid by the applicable
Holder for the Ordinary Shares and the Warrant Shares. Such indemnity shall remain in
full force and effect regardless of any investigation made by or on behalf of such
Indemnified Party and shall survive the transfer of the Registrable Securities by the
Holders pursuant to Section 9. 






27







	 	6.3 	Promptly
after receipt by an Indemnified Person or Indemnified Party under this Section 6 of
notice of the commencement of any action or proceeding (including any governmental action
or proceeding) involving a Claim, such Indemnified Person or Indemnified Party shall, if
a Claim in respect thereof is to be made against any indemnifying party under this
Section 6, deliver to the indemnifying party a written notice of the commencement
thereof, and the indemnifying party shall have the right to participate in, and, to the
extent the indemnifying party so desires, jointly with any other indemnifying party
similarly noticed, to assume control of the defense thereof with counsel mutually
satisfactory to the indemnifying party and the Indemnified Person or the Indemnified
Party, as the case may be; provided, however, that an Indemnified Person or Indemnified
Party shall have the right to retain its own counsel with the fees and expenses of not
more than one counsel for such Indemnified Person or Indemnified Party to be paid by the
indemnifying party, if, the representation by such counsel of the Indemnified Person or
Indemnified Party and the indemnifying party would be inappropriate due to actual or
potential differing interests between such Indemnified Person or Indemnified Party and
any other party represented by such counsel in such proceeding. In the case of an
Indemnified Person, legal counsel referred to in the immediately preceding sentence shall
be selected by the Holders holding a majority in interest of the Registrable Securities
included in the Registration Statement to which the Claim relates. The Indemnified Party
or Indemnified Person shall cooperate with the indemnifying party in connection with any
negotiation or defense of any such action or Claim by the indemnifying party and shall
furnish to the indemnifying party all information reasonably available to the Indemnified
Party or Indemnified Person which relates to such action or Claim. The failure to deliver
written notice to the indemnifying party within a reasonable time of the commencement of
any such action shall not relieve such indemnifying party of any liability to the
Indemnified Person or Indemnified Party under this Section 6, except to the extent that
the indemnifying party is prejudiced in its ability to defend such action, but the
omission to so notify the indemnifying party will not relieve such indemnifying party of
any liability that it may have to any Indemnified Person or Party otherwise than under
this Section 6.3, including under Section 6.5. 






	 	6.4 	The
indemnification required by this Section 6 shall be made by periodic payments of the
amount thereof during the course of the investigation or defense, as and when bills are
received or Indemnified Damages are incurred. 






28







	 	6.5 	The
indemnity agreements contained herein shall be in addition to (i) any cause of action or
similar right of the Indemnified Party or Indemnified Person against the indemnifying
party or others, and (ii) any liabilities the indemnifying party may be subject to
pursuant to the law. 






	7. 	CONTRIBUTION. 






	  	12.        
To
the extent any indemnification by an indemnifying party is prohibited or
          limited by law or insufficient to hold an Indemnified Person or an Indemnified
          Party, as the case may be, harmless, then the indemnifying party, in lieu of
          indemnifying such Indemnified Person or Indemnified Party hereunder, shall
          contribute to the amount paid or payable by such Indemnified Person or
          Indemnified Party as a result of such Claims and Indemnified Damages (each as
          defined in Section 6.1 above) in such proportion as is appropriate to reflect
          the relative fault of the indemnifying party on the one hand and of the
          Indemnified Person or Indemnified Party, as the case may be, on the other in
          connection with the statements or omissions that resulted in such loss,
          liability, claim, damage, or expense as well as any other relevant equitable
          considerations. The relative fault of the indemnifying party and of the
          Indemnified Person or Indemnified Party, as the case may be, shall be
determined           by reference to, among other things, whether the untrue or alleged
untrue           statement of a material fact or the omission to state a material fact
relates to           information supplied by the indemnifying party or by the Indemnified
Person or           Indemnified Party, as the case may be, and the parties’ relative
intent,           knowledge, access to information, and opportunity to correct or prevent
such           statement or omission.  






	  	13.        
Notwithstanding
the foregoing, (i) no Person involved in the sale of Registrable           Securities,
which Person is guilty of fraudulent misrepresentation (within the           meaning of
Section 11(f) of the 1933 Act) in connection with such sale, shall be           entitled
to contribution from any Person involved in such sale of Registrable           Securities
who was not guilty of fraudulent misrepresentation; and (ii)           contribution by
any seller of Registrable Securities shall be limited in amount           to the net
amount of proceeds received by such seller from the sale of such           Registrable
Securities pursuant to such Registration Statement.  






	8. 	REPORTS
UNDER THE 1934 ACT. 






	 	
With
a view to making available to the Holders the benefits of Rule 144 promulgated under the
1933 Act or any other similar rule or regulation of the SEC that may at any time permit
the Holders to sell securities of the Company to the public without registration (“Rule
144”), the Company agrees to:  






	 	8.1 	make
and keep public information available, as those terms are understood and defined in Rule
144;






	 	8.2 	file
with the SEC in a timely manner all reports and other documents required by the Company
under the 1993 Act and the 1934 Act so long as the Company remains subject to such
requirements and the filing of such reports and other documents is required for the
applicable provisions of Rule 144; and 







29






	 	8.3 	furnish
to each Holder so long as such Holder owns Registrable Securities, promptly upon request,
(i) a written statement by the Company that it has complied with the reporting
requirements of Rule 144, the 1933 Act and the 1934 Act, (ii) a copy of the most recent
annual or quarterly report of the Company and such other reports and documents so filed
by the Company, and (iii) such other information as may be reasonably requested to permit
the Holders to sell such securities pursuant to any rule or regulation of the SEC
allowing the Holder to sell any securities without registration. 






	9.  	ASSIGNMENT
OF REGISTRATION RIGHTS. 






	 	
Subject
to the prior approval of the Company, not to be unreasonably withheld, at any time prior
to the time the Registration Statement was filed with the SEC, the rights under this
Agreement shall be assignable by each Investor to any transferee of all or any portion of
such Investor’s Registrable Securities or the Warrant if: (i) the Investor agrees in
writing with the transferee or assignee to assign such rights, and a copy of such
agreement is furnished to the Company within a reasonable time after such assignment;
(ii) the Company is, within a reasonable time after such transfer or assignment,
furnished with written notice of (a) the name and address of such transferee or assignee,
and (b) the securities with respect to which such registration rights are being
transferred or assigned; (iii) immediately following such transfer or assignment the
further disposition of such securities by the transferee or assignee is restricted under
the 1933 Act and applicable state securities laws; (iv) at or before the time the Company
receives the written notice contemplated by clause (ii) of this sentence the transferee
or assignee agrees in writing with the Company to be bound by all of the provisions
contained herein; and (v) such transfer shall have been made in accordance with the
applicable requirements of the Purchase Agreement and applicable securities laws.  






	10.  	MISCELLANEOUS 






	 	10.1 	Amendments;
 Waivers.  This  Agreement  may not be amended,  changed,  supplemented,  waived or
 otherwise                   modified or  terminated,  except upon the  execution  and
delivery of a written                   agreement executed by the Company and the
Investors.






	 	10.2 	Entire
Agreement. This Agreement constitutes the entire agreement between the parties hereto
pertaining to its subject matter, and supersedes and replaces all prior agreements and
understandings of the parties in connection with such subject matter. 






30







	 	10.3 	Notices.
All notices and other communications required or permitted hereunder to be given to a
party to this Agreement shall be in writing and shall be faxed or mailed by registered or
certified mail, postage prepaid, or otherwise delivered by hand or by messenger in
accordance with the provisions of the Purchase Agreement. 






	 	10.4 	Governing
Law; Jurisdiction. This Agreement shall be governed by and construed according to the
internal laws of the State of Israel without regard to the provisions relating to
conflicts of law. Any dispute arising under or in relation to this Agreement shall be
resolved exclusively by the competent courts of Tel-Aviv Jaffa district, and the parties
hereto irrevocably submit to the exclusive jurisdiction of such court for such purposes. 






	 	10.5 	Successors
and Assigns. Except as otherwise expressly limited herein, the provisions of this
Agreement shall inure to the benefit of, and shall be binding upon, the successors and
permitted assigns of the parties hereto. This Agreement may not be assigned by any party
without the prior written consent of the other party hereto. 






	 	10.6 	Severability.
If any provision of this Agreement is held by a court of competent jurisdiction to be
unenforceable under applicable law, then such provision shall be excluded from this
Agreement and the remainder of this Agreement shall be interpreted as if such provision
were so excluded and shall be enforceable in accordance with its terms; provided,
however, that in such event this Agreement shall be interpreted so as to give effect, to
the greatest extent consistent with and permitted by applicable law, to the meaning and
intention of the excluded provision as determined by such court of competent
jurisdiction. 






	 	10.7 	No
Waiver. The failure of any party hereto to exercise any right, power or remedy
provided under this Agreement or otherwise available in respect hereof at law or in
equity, or to insist upon compliance by any other party hereto with its obligations
hereunder, and any custom or practice of the parties at variance with the terms hereof,
shall not constitute a waiver by such party of its right to exercise any such or other
right, power or remedy or to demand such compliance. 






31








	 	10.8 	Headings.
The section and paragraph headings in this Agreement are for convenience of reference
only and are not intended to be a part of this Agreement or to affect the meaning or
interpretation of this Agreement. 







	 	10.9 	Counterparts.
This Agreement may be executed in one or more counterparts (including facsimile
counterparts), all of which taken together shall constitute one agreement. 






	 	10.10 	Equitable
Relief. The parties hereto agree that legal remedies may be inadequate to enforce the
provisions of this Agreement and that equitable relief, including specific performance
and injunctive relief, may be used to enforce the provisions of this Agreement. 






[REMAINDER OF PAGE INTENTIONALLY
LEFT BLANK]  



32







        IN
WITNESS WHEREOF, the parties hereto have executed this Registration Rights Agreement as of
the date first set forth above. 








		
	B.O.S BETTER ON LINE SOLUTIONS LTD.
	 
	By:	____________________________
	 
	Name:	____________________________
	 
	Title:	____________________________
	 
	 
	 ____________________________
	 
	By:	____________________________
	 
	Name:	____________________________
	 
	Title:	____________________________
	 
	 
	 ____________________________
	 
	By:	____________________________
	 
	Name:	____________________________
	 
	Title:	____________________________




















[SIGNATURE PAGE OF
REGISTRATION RIGHTS AGREEMENT] 




33







	 	
THIS
WARRANT AND THE ORDINARY SHARES ISSUABLE UPON EXERCISE OF THIS WARRANT HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES LAWS.
THIS WARRANT AND THE ORDINARY SHARES ISSUABLE UPON EXERCISE OF THIS WARRANT MAY NOT BE
SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE
REGISTRATION STATEMENT AS TO THIS WARRANT UNDER SAID ACT AND ANY APPLICABLE STATE
SECURITIES LAWS OR AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO B.O.S. BETTER ONLINE
SOLUTIONS LTD. THAT SUCH REGISTRATION IS NOT REQUIRED.  






Right to Purchase up to
________ Ordinary Shares of
 B.O.S. Better Online
Solutions Ltd.
(subject to adjustment
as provided herein)  





ORDINARY SHARES
PURCHASE WARRANT 


		
	No. _________________	Issue Date: December 31, 2007 





        B.O.S.
          BETTER ONLINE SOLUTIONS LTD. a company incorporated under the laws of the State
          of Israel hereby certifies that, for value received, ___________, or assigns
          (the “Holder”), is entitled, subject to the terms set forth below, to
          purchase from the Company (as defined herein) from and after the Issue Date of
          this Warrant and at any time or from time to time before 5:00 p.m., New York
          time, through the close of business December 31, 2011 (the “Expiration
          Date”), up to _________ fully paid and nonassessable Ordinary Shares (as
          hereinafter defined), NIS 4.00 nominal value per share, at the exercise price
of           $2.76 per Ordinary Share (the “Exercise Price”). The number and
          character of such Ordinary Shares and the Exercise Price per share are subject
          to adjustment as provided herein.  




        As
used herein the following terms, unless the context otherwise requires, have the following
respective meanings: 



		    (a)        The
term “Company” shall include B.O.S. Better Online Solutions Ltd.
               and any corporation which shall succeed, or assume the obligations of,
B.O.S.                Better Online Solutions Ltd. hereunder.  







		    (b)        The
term “Other Securities” refers to any securities of the Company or
               any other person (corporate or otherwise) which the Holder of the Warrant
at any                time shall be entitled to receive, or shall have received, on the
exercise of                the Warrant, in lieu of or in addition to Ordinary Shares, or
which at any time                shall be issuable or shall have been issued in exchange
for or in replacement of                Ordinary Shares or Other Securities pursuant to
Section 3 or otherwise.  







34







        Capitalized
terms used herein without definition shall have the meanings ascribed to such terms in
that Securities Purchase Agreement dated as of the date hereof by and among the Company
and the Investor (as defined therein). 



	14.  	Exercise
of Warrant. 






    14.1        Number
of Shares Issuable upon Exercise. From and after the date hereof through and
including the Expiration Date, the Holder shall be entitled to receive, upon exercise of
this Warrant in whole or in part, by delivery of an original or fax copy of an exercise
notice in the form attached hereto as Exhibit A (the “Exercise Notice”)
and payment in accordance with Section 2.2 below, Ordinary Shares of the Company (the
“Warrant Shares”), subject to adjustment pursuant to Section 4.  




    14.2        Company
Acknowledgment. The Company will, at the time of the partial exercise of the Warrant,
upon the request of the Holder hereof acknowledge in writing its continuing obligation to
afford to such Holder any rights to which such Holder shall continue to be entitled after
such partial exercise in accordance with the provisions of this Warrant. If the Holder
shall fail to make any such request, such failure shall not affect the continuing
obligation of the Company to afford to such Holder any such rights.  




	15.  	Procedure
for Exercise. 






    15.1        Delivery
of Share Certificates, Etc., on Exercise. The Company agrees that the Warrant Shares
purchased upon exercise of this Warrant shall be deemed to be issued to the Holder as the
record owner of such shares as of the close of business on the date on which this Warrant
shall have been surrendered and payment made for such shares in accordance herewith. As
soon as practicable after the exercise of this Warrant in full or in part, and in any
event within three (3) business days thereafter, the Company at its expense (including
the payment by it of any applicable issue taxes) will cause to be issued in the name of
and delivered to the Holder, or as such Holder (upon payment by such Holder of any
applicable transfer taxes) may direct in compliance with applicable securities laws, a
certificate or certificates for the number of duly and validly issued, fully paid and
nonassessable Warrant Shares (or Other Securities) to which the Holder shall be entitled
on such exercise.  




    15.2        Exercise.  



		    15.2.1        Payment
shall be made in cash, by wire transfer to a bank account the details of which shall have
been provided by the Company to the Holder in writing or by certified or official bank
check payable to the order of the Company, of the amount equal to the applicable
aggregate Exercise Price for the number of Ordinary Shares specified in the Exercise
Notice (as such exercise number shall be adjusted to reflect any adjustment in the total
number of Warrant Shares issuable to the Holder per the terms of this Warrant) and the
Holder shall thereupon be entitled to receive the applicable number of duly authorized,
validly issued, fully-paid and non-assessable Warrant Shares (or Other Securities)
determined as provided herein.  







35







    15.3        Fractional
Shares. This Warrant may not be exercised for fractional shares. In lieu of
fractional shares the Company shall make a cash payment therefor based upon the Exercise
Price then in effect.  




	16. 	    Effect
of Reorganization, Etc.; Adjustment of Exercise Price. 






    16.1        Reorganization,
Consolidation, Merger, Etc. In case at any time or from time to time, the Company
shall (a) effect a reorganization, (b) consolidate with or merge into any other person,
including the sale of substantially all of the Company’s outstanding share capital
to a corporate third party, in consideration for such third party’s securities, or
(c) transfer all or substantially all of its properties or assets to any other person
under any plan or arrangement contemplating the dissolution of the Company, then, in each
such case, as a condition to the consummation of such a transaction, proper and adequate
provision shall be made by the Company whereby the Holder of this Warrant, on the
exercise hereof as provided in Sections 1 and 2 at any time after the consummation of
such reorganization, consolidation or merger or the effective date of such dissolution,
as the case may be, shall receive, in lieu of the Ordinary Shares issuable on such
exercise prior to such consummation or such effective date, the shares and Other
Securities and property (including cash) to which such Holder would have been entitled
upon such consummation or in connection with such dissolution, as the case may be, if
such Holder had so exercised this Warrant, immediately prior thereto, all subject to
further adjustment thereafter as provided in Section 4.  




    16.2        Extraordinary
Events Regarding Ordinary Shares. In the event that the Company shall (a) issue
additional Ordinary Shares as a dividend or other distribution on outstanding Ordinary
Shares, (b) subdivide its outstanding Ordinary Shares, or (c) combine its outstanding
Ordinary Shares into a smaller number of Ordinary Shares, then, in each such event, the
Exercise Price shall, simultaneously with the happening of such event, be adjusted by
multiplying the then Exercise Price by a fraction, the numerator of which shall be the
number of Ordinary Shares outstanding immediately prior to such event and the denominator
of which shall be the number of Ordinary Shares outstanding immediately after such event,
and the product so obtained shall thereafter be the Exercise Price then in effect. The
Exercise Price, as so adjusted, shall be readjusted in the same manner upon the happening
of any successive event or events described herein in this Section 3.2. The number of
Ordinary Shares that the Holder of this Warrant shall thereafter, on the exercise hereof
be entitled to receive shall be increased or decreased, as the case may be, to a number
determined by multiplying the number of Ordinary Shares that would otherwise (but for the
provisions of this Section 3.2) be issuable on such exercise by a fraction of which (a)
the numerator is the Exercise Price that would otherwise (but for the provisions of this
Section 3.2) be in effect, and (b) the denominator is the Exercise Price in effect on the
date of such exercise.  



    16.3        Good
Faith. All determinations with respect to adjustments by the Company hereunder shall
be made by the Board of Directors in good faith.  



36

































        17.    Certificate
as to Adjustments. In each case of any adjustment or           readjustment in the
Ordinary Shares (or Other Securities) issuable on the           exercise of the Warrant,
the Company at its expense will promptly cause its           Chief Financial Officer or
other appropriate designee to compute such adjustment           or readjustment in
accordance with the terms of the Warrant and prepare a           certificate setting
forth such adjustment or readjustment and showing in detail           the facts upon
which such adjustment or readjustment is based.  




        18.    Reservation
of Shares, Etc., Issuable on Exercise of Warrant. The Company           will at all
times reserve and keep available, solely for issuance and delivery           on the
exercise of the Warrant, Ordinary Shares (or Other Securities) from time           to
time issuable on the exercise of the Warrant.  




        19.    Representations
of the Company. The Company represents that (i) all           corporate actions on
the part of the Company, its officers, directors and           shareholders necessary for
the sale and issuance of the Warrant Shares pursuant           hereto and the performance
of the Company’s obligations hereunder were           taken prior to and are
effective as of the issue date of this Warrant; (ii) the           Warrant Shares are
duly authorized and reserved for issuance by the Company and,           when issued in
accordance with the terms hereof, will be validly issued, fully           paid and
nonassessable and not subject to any preemptive rights, and (iii) the           execution
and delivery of this Warrant are not, and the issuance of the Warrant           Shares
upon exercise of this Warrant in accordance with the terms hereof will           not be,
inconsistent with the Company’s Articles of Association, do not and           will
not contravene any law, governmental rule or regulation, or, to the           Company’s
knowledge, any judgment or order applicable to the Company, and,           except for
consents that have already been obtained by the Company or except as           would not
have a Material Adverse Effect, do not and will not conflict with or           contravene
any provision of, or constitute a default under, any indenture,           mortgage,
contract or other instrument of which the Company is a party or by           which it is
bound, or require the consent or approval of, the giving of notice           to, the
registration with or the taking of any action in respect of or by any
          government authority or agency or other person.. as used herein, “Material
          Adverse Effect” means any material adverse effect on the business,
          properties, assets, operations, prospects, results of operations or condition
          (financial or otherwise) of the Company and its subsidiaries, taken as a whole.  




        20.    Representations
and Warranties by the Holder. The Holder represents and           warrants to the
Company as follows:  




		    20.1        Holder
understands that the Warrant is being offered and sold pursuant to an exemption or
exemptions from registration requirements of Israeli and US Federal and state securities
laws and that the Company is relying upon the truth and accuracy of Holder’s
representations contained in that Securities Purchase Agreement of even date herewith,
including, without limitation, that the Holder is an “Accredited Investor” within
the meaning of Regulation D under the Securities Act of 1933.  








		    20.2        Holder
has substantial experience in evaluating and investing in private placement transactions
of securities in companies similar to the Company so that it is capable of evaluating the
merits and risks of its investment in the Company and has the capacity to protect its own
interests. Holder is able to bear the economic risk of this investment.  







37








		    20.3        Holder
is acquiring the Warrant and the Ordinary Shares issuable upon exercise of the Warrant
for its own account for investment only, and not as a nominee or agent and not with a
view towards or for resale in connection with their distribution.  








    21.        Assignment;
Exchange of Warrant. Subject to compliance with applicable           securities laws,
this Warrant, and the rights evidenced hereby, may be           transferred in whole by
any registered Holder hereof (a “Transferor”)           in whole or in part. On
the surrender for exchange of this Warrant, with the           Transferor’s
endorsement in the form of Exhibit B attached hereto           (the “Transferor
Endorsement Form”) and together with evidence           reasonably satisfactory to
the Company demonstrating compliance with applicable           securities laws, which
shall include, without limitation, a legal opinion from           the Transferor’s
counsel that such transfer is exempt from the registration           requirements of
applicable securities laws, the Company at its expense (but with           payment by the
Transferor of any applicable transfer taxes) will issue and           deliver a new
Warrant of like tenor, in the name of the transferee specified in           such
Transferor Endorsement Form (each a “Transferee”), calling in the
          aggregate on the face thereof for the number of Ordinary Shares called for on
          the face of the Warrant so surrendered by the Transferor. Notwithstanding the
          foregoing, no opinion of counsel or “no-action” letter shall be
          necessary for a transfer without consideration by a Holder to any other entity
          which controls, is controlled by or is under common control with the Holder.  




    22.        Replacement
of Warrant. On receipt of evidence reasonably satisfactory to           the Company
of the loss, theft, destruction or mutilation of this Warrant and,           in the case
of any such loss, theft or destruction of this Warrant, on delivery           of an
indemnity agreement or security reasonably satisfactory in form and amount           to
the Company or, in the case of any such mutilation, on surrender and
          cancellation of this Warrant, the Company at its expense will execute and
          deliver, in lieu thereof, a new Warrant of like tenor.  




    23.        Registration
Rights. The Holder of this Warrant has been granted certain           registration
rights by the Company. These registration rights are set forth in a
          Registration Rights Agreement entered into by the Company and the Holder dated
          as of even date of this Warrant.  




    24.        Rights
of Shareholders. No Holder shall be entitled, in its capacity as a           Warrant
holder only, to vote or receive dividends or be deemed the holder of the
          Ordinary Shares or any Other Securities of the Company, which may at any time
be           issuable upon the exercise of this Warrant for any purpose, nor shall
anything           contained herein be construed to confer upon the Holder, as such, any
of the           rights of a shareholder of the Company or any right to vote for the
election of           directors or upon any other matter submitted to shareholders at any
meeting           thereof, or to give or withhold consent to any corporate action
(whether upon           any recapitalization, issuance of shares, reclassification of
shares, change of           nominal value, consolidation, merger, conveyance, or
otherwise) or to receive           notice of meetings, or to receive dividends or
subscription rights or otherwise           until the Warrant shall have been exercised
and the Ordinary Shares issuable           upon the exercise hereof shall have become
deliverable, as provided herein.  




    25.        Transfer
on the Company’s Books. Until this Warrant is transferred           on the books
of the Company, the Company may treat the registered holder hereof           as the
absolute owner hereof for all purposes, notwithstanding any notice to the
          contrary.  



38








    26.        Notices,
Etc. All notices and other communications from the Company to           the Holder of
this Warrant shall be deemed to have been sufficiently given and           received for
all purposes, (i) when delivered in writing by hand, upon delivery;           (ii) if
sent via facsimile, upon transmission and electronic confirmation of           receipt
(and if transmitted and received on a non-business day, on the first           business
day following transmission and electronic confirmation of receipt),           (iii) seven
(7) business days (and fourteen (14) business days for international           mail)
after being sent by certified or registered mail, postage and charges           prepaid,
return receipt requested, or (iv) three (3) business days after being           sent by
internationally overnight delivery providing receipt of delivery, to the
          address as may have been furnished to the Company in writing by such Holder or,
          until any such Holder furnishes to the Company an address, then to, and at the
          address of, the last Holder of this Warrant who has so furnished an address to
          the Company.  




    27.        Miscellaneous.
This Warrant and any term hereof may be changed, waived,           discharged or
terminated only by an instrument in writing signed by the party           against which
enforcement of such change, waiver, discharge or termination is           sought. This
Warrant shall be governed by and construed in accordance with the           laws of the
State of Israel without regard to principles of conflicts of laws.           Any dispute
arising under or in relation to this Agreement shall be adjudicated           in the
competent court of Tel Aviv-Jaffa district only, and each of the parties           hereby
submits irrevocably to the exclusive jurisdiction of such court. In the           event
that any provision of this Warrant is invalid or unenforceable under any
          applicable statute or rule of law, then such provision shall be deemed
          inoperative to the extent that it may conflict therewith and shall be deemed
          modified to conform with such statute or rule of law. Any such provision, which
          may prove invalid or unenforceable under any law shall not affect the validity
          or enforceability of any other provision of this Warrant. The headings in this
          Warrant are for purposes of reference only, and shall not limit or otherwise
          affect any of the terms hereof. The invalidity or unenforceability of any
          provision hereof shall in no way affect the validity or enforceability of any
          other provision.  




[BALANCE OF PAGE
INTENTIONALLY LEFT BLANK;
SIGNATURE PAGE FOLLOWS] 



39








        IN
WITNESS WHEREOF, this Warrant is executed as of the date first written above. 



		
	B.O.S. BETTER ONLINE SOLUTIONS LTD.	_______________________










		
	By:  _______________________ 	By:  _______________________  






		
	Name:  _______________________ 	Name:  _______________________  








		
	Title:  _______________________ 	Title::  _______________________  






40










EXHIBIT A 



FORM OF SUBSCRIPTION 
(To Be Signed Only On
Exercise Of Warrant)  



	 	
To:  
     B.O.S. Better Online Solutions Ltd. 












	 	
Attention:  
       Chief Financial Officer 







        The
undersigned, pursuant to the provisions set forth in the attached Warrant (No.____),
hereby irrevocably elects to purchase (check applicable box): 



________                                                   ________
 Ordinary Shares covered by such Warrant; 






o
    The undersigned herewith makes
payment of the full Exercise Price for such shares at the price per share provided for in
such Warrant, which is $___________. Such payment takes the form of (check applicable box
or boxes): 






	 		
	 	o
 	$__________
by wire transfer of lawful money of the United States; and/or 







	 		
	 	o
 	$__________
by  certified  or  official  bank  check  payable to the order of the
                          Company 










        The
 undersigned  requests that the certificate for such shares be issued in the name of, and
delivered to ______________________________________________                   whose
                 address                  is
__________________________________________________________________________________________________________.  






        The
undersigned represents and warrants that all offers and sales by the undersigned of the
securities issuable upon exercise of the within Warrant shall be made pursuant to
registration of the Ordinary Shares under the Securities Act of 1933, as amended (the
“Securities Act”) or pursuant to an exemption from registration under the
Securities Act.  




    





			
		Dated:  __________________	____________________________________________________________________ 

 (Signature
must conform to name of 
 Holder as specified on the face of the Warrant)
			












	 	
Address:  _______________________________

                   _______________________________







A - 1








EXHIBIT B  



FORM OF TRANSFEROR
ENDORSEMENT 
(To Be Signed Only on
Transfer of Warrant) 



For value received, the undersigned
hereby sells, assigns, and transfers unto the person named below under the heading
“Transferee” the right represented by the within Warrant to purchase the number
of Ordinary Shares of B.O.S Better Online Solutions Ltd. into which the within Warrant
relates and appoints each such person attorney-at-fact to transfer its respective right on
the books of B.O.S. Better Online Solutions Ltd. with full power of substitution. 



		
	NAME OF TRANSFEREE  	ADDRESS  












			
	DATED: 	__________________________	____________________________________________________
(SIGNATURE MUST CONFORM TO NAME
 OF HOLDER AS SPECIFIED ON THE FACE
OF THE WARRANT) 
			











	 	
ADDRESS:  





	 	
__________________________  






	 	
__________________________  







	 	
ACCEPTED
AND AGREED:

          [TRANSFEREE] 







	 	
By:    ____________________________  







	 	
Name:    ____________________________  







	 	
Title:    ____________________________  








B - 1